U.S. short sales jump as banks try to clear distressed inventory

TRD New York /
Aug.August 25, 2011 02:12 PM

Sales of homes that were in some stage of foreclosure or bank-owned accounted for 31 percent of all U.S. residential sales in the second quarter of 2011, up from 24 percent of all sales in the second quarter of 2010, according to a market report by RealtyTrac, released today. Pre-foreclosure sales jumped 19 percent from the first quarter.

The average sales price of a foreclosed or bank-owned property was $164,217 in the second quarter of this year, down less than 1 percent from the first quarter and down nearly 5 percent from the second quarter of 2010.

“With average prices on distressed real estate trending down and average discounts trending up, this report is clearly good news for well-positioned buyers and investors looking for bargain real estate that will build them wealth in the long term and often cash flow as rental real estate in the short term,” said James Saccacio, CEO of RealtyTrac.

Perhaps less evident, Saccacio said, is that a jump in pre-foreclosure sales coupled with bigger discounts on pre-foreclosures amounts to good news for distressed homeowners as banks focus on more efficiently clearing distressed inventory through more streamlined short sales.

“This gives distressed homeowners who do not qualify for loan modification or refinancing — or who are not interested in those options and want to sell — a better chance of completing a short sale to avoid foreclosure. Streamlined short sales also give lenders the opportunity to more pre-emptively purge non-performing loans from their portfolios and avoid the long, costly and increasingly messy process of foreclosure and the subsequent sale of an REO,” Saccacio said. — Katherine Clarke


Related Articles

arrow_forward_ios
Nationwide foreclosures are at a 15-year low (Credit: iStock)

Foreclosures nationwide fell to 15-year low in 2019

494 Broadway and Thor Equities' Joe Sitt (Credit: Google Maps)

Thor faces foreclosure on site where lender says it’s seeking “unrealistic rents”

Maefield Development's Mark Siffin and 20 Times Square (Credit: Maefield)

Lender forecloses on Maefield’s billion-dollar Times Square project

Thor Equities' Joe Sitt and 725 8th Avenue (Credit: Google Maps)

Thor facing foreclosure at Theater District building

Home foreclosures dropped nearly 20% in Q3, report shows

Home foreclosures dropped nearly 20% in Q3, report shows

Manhattan’s 10019 zip code, which covers Midtown, Times Square, Herald Square and Midtown South, saw the most foreclosures in the borough with eight. (Credit: iStock)

Manhattan foreclosures soar 118%, driven by mortgage defaults

15 East 63rd Street and Oleg Cassini (Credit: Google Maps and Getty Images)

Oleg Cassini’s former UES headquarters faces foreclosure

Mayor Bill de Blasio and Frank Carone (Credit: Getty Images)

City tapped De Blasio donor to take over foreclosed properties

arrow_forward_ios
Loading...